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4 Savings Strategies for Peace of Mind in Retirement

By U.S. News & World Report

For many people, day-to-day budgeting and financial planning can seem daunting. Fast-forward to retirement, with the stress of not having your regular paycheck, and this can make managing your finances seem even more overwhelming.

To help alleviate this stress, you may need to look at your savings in a way that will help you meet your retirement goals and keep you feeling secure no matter what life throws at you. Here are a few tips and strategies to help you do just that as you plan for your future.

Find your income. One of the biggest adjustments to retired life is not getting the steady income you’ve grown accustomed to while employed. It helps to think about how you will turn the money you have saved and any benefits you may be collecting, such as Social Security or pension income, into retirement income.

For starters, determine your expected monthly retirement income and adjust your monthly savings to fill any savings gaps. Think about your income needs in retirement rather than getting nervous about hitting one big number. Consider all the assets you’ll be able to leverage in retirement, including your retirement savings. Expenses play a key role in a successful income strategy, so try to at least estimate monthly retirement expenses.

As you near retirement, think about your withdrawal schedule for your savings and how to time receiving Social Security or pension benefits to best fit into your monthly income plan. By setting a sort of “pay schedule” for your retirement funds, you’ll be able to feel more confident that you have the money you need for a secure future.

Plan for health care. According to the Voya Retire Ready Index, 91 percent of Americans express concern about the inability to pay for health care expenses in retirement. This is where your retirement income plan can really help give you some peace of mind. By breaking down future savings and needs into anticipated monthly income and expenses, you will be better prepared to cover regular health care costs. Additionally, should any major or unexpected costs arise, you’ll be able to identify areas in your budget where you can reallocate funds to cover those expenses.

As you head into retirement, also consider meeting with a financial advisor to talk about what health care options are available to you. Often, retirees assume that Medicare will cover all of their needs, but there are some conditions and procedures that may fall outside Medicare and take you by surprise. Meet with an advisor or even talk to your doctor to determine what supplementary plans you could enroll in to make sure you have all the coverage you need in retirement.

Time your Social Security benefits. Social Security decisions are often another major stress for preretirees, with 88 percent of workers reporting concern about having fewer benefits than expected, according to the Voya Retire Ready Index. What many people don’t realize is that their plans for retirement may mean they are not fully maximizing Social Security benefits.

Voya Financial found that 59 percent of retirees started taking Social Security benefits before age 65. The Social Security Administration has specific definitions of “full retirement age,” currently set between 66 and 67 years old. If Social Security is claimed before this age, benefits are generally reduced, but if you delay your retirement up to age 70, your benefits generally increase.

Maximize retirement accounts. You may similarly be missing out on retirement benefits by not taking full advantage of workplace retirement accounts. If you are enrolled in a 401(k) or similar plan through your employer, find out if it matches your plan contributions. This match is essentially “free” money, so don’t leave in on the table. Every dollar that you put away (even if it’s just a small amount) will have a major impact on your finances in retirement. Taking advantage of an employer match program will make those dollars go even further. By saving and utilizing all the resources available to you, you can be well-positioned to turn savings into a reliable stream of retirement income when the time is right.

Planning for retirement can seem like a long and difficult process, so be sure to have a plan. Think about your finances in terms of your lifestyle and what new adventures you may want to have. By setting a budget today and maximizing your benefits, you’ll be well-positioned for success.

More from U.S. News

10 Ways to Build a $1 Million Nest Egg

A Smart Investing Plan for 30-Somethings

10 Mistakes You’re Making in Your 401(k)

4 Savings Strategies for Peace of Mind in Retirement originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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